Skift Breaking News Blog

Short stories and posts about the daily news happenings around the travel industry.

Airlines

Spirit Airlines Delays Vote Again to Continue Merger Talks

5 days ago

For all who hoped for some resolution to the months-long saga over the future of Spirit Airlines on June 30, no go. The carrier has postponed a shareholder vote on a merger with Frontier Airlines to July 8.

Spirit will immediately open and close the June 30 meeting with no vote in order for its board to “continue discussions” with both preferred suitor Frontier and hostile bidder JetBlue Airways, the Florida-based discounter said late Wednesday. This is the second time Spirit has delayed a shareholder vote, which was first scheduled for June 10.

(Edward Russell/Skift)

Frontier is offering shareholders $4.13 plus 1.91 of its own shares for each Spirit share plus a $350 million reverse break-up fee, while JetBlue is offering at least $33.50 per share to up to $34.15 a share based on certain conditions and a $400 million break-up fee. All in, Frontier’s offer is worth $2.4 billion and JetBlue’s nearly $3.8 billion, according to an analysis by Raymond James.

The resulting airline from either a Spirit-Frontier or Spirit-JetBlue merger will be the fifth largest in the U.S. with a roughly 8 percent share of the market.

Airlines

JetBlue Ups Breakup Fee in Spirit Airlines Bidding War Move

7 days ago

JetBlue Airways is not done yet trying to acquire Spirit Airlines. With just three days until shareholders vote, the New York-based carrier has upped its offer again, raising its reverse breakup fee to $400 million to beat rival bidder Frontier Airlines.

JetBlue’s latest offer — its fourth for Spirit — also includes a prepayment of $2.50 per share of the breakup fee, and a “ticking fee mechanism” where the airline would pay Spirit shareholders an additional $0.10 per share monthly from January 2023 until the deal closed, JetBlue said Monday. The ticking fee could increase JetBlue’s overall offer to as much as $34.15 per share. Its last offer was for $33.50 per share plus a $350 million breakup fee.

(vic_206/Flickr)

“We’ve discussed our offer directly with Spirit shareholders and are now modifying our proposal in response to shareholders’ expressed interest, to include a monthly payment for shareholders, with the certainty of a significant cash premium at closing,” JetBlue CEO Robin Hayes said Monday.

And, in a letter directly to Spirit shareholders, Hayes said the airline’s board has “never negotiated with us and have now favored a transaction that better serves Frontier’s controlling shareholder than Spirit’s shareholders.”

Frontier’s latest offer, unveiled on June 24, included an additional $2 per share for a total of $4.13 a share, plus a $350 million reverse break up fee. The offer was valued at $2.7 billion based on closing stock prices that day.

Spirit shareholders will vote to accept or reject Frontier’s offer on June 30.

Airlines

JetBlue Adds Blade Helicopter Flights to Loyalty Program

2 weeks ago

Getting a quick lift on a Blade Air Mobility helicopter from New York’s JFK airport to Manhattan? Soon travelers will also get perks in JetBlue Airways’ loyalty program, TrueBlue, on their flight.

JetBlue will offer top tier Mosaic TrueBlue members a “limited number” of free seats on Blade’s flights between its heliport on East 34th Street in Manhattan and JFK airport, and all TrueBlue members will have access to “preferred pricing” for their first Blade airport flight. What is not clear is whether Blade flights will earn TrueBlue members points in the loyalty program. Blade will be “integrated” into the TrueBlue program — suggesting more benefits are to come — by early 2023.

(Blade)

“This partnership with Blade will help us further evolve and enhance our TrueBlue program so our
most loyal customers can enjoy more perks more often,” JetBlue Vice President of Loyalty and Partnerships Chris Buckner said.

The JetBlue-Blade partnership evokes a similar image to that of the electric vertical takeoff and landing, or eVTOL, aircraft the likes of American Airlines, United Airlines, and others see as the future of connecting people to a major airport in a large metropolitan area. However, Blade, which operates traditional gas-powered helicopters, is very much of the past generation of polluting, noisy, and exclusive urban air transport that the eVTOL industry is trying to distance itself from. Tickets on Blade flights from either JFK or Newark airports to Manhattan begin at $195 per person; the cost of a train ride from either airport ranges from $15.50 to $18.75 per person.

Blade will begin offering “continuous” service 13 hours a day, six days a week between Manhattan and JFK on June 27.

Airlines

JetBlue Ups Offer for Spirit Airlines Again, Now Totaling $3.7 Billion

2 weeks ago

With the likelihood improving of a successful bid for Spirit Airlines, JetBlue Airways has raised its offer for the discounter a second time in as many weeks.

The New York-based airline is now offering Spirit shareholders $33.50 per share, or a total of $3.7 billion, JetBlue said Monday. That is a $2 per share improvement over its last offer of $31.50 a share that it made on June 6, and $0.50 more than it initial offer in April of $33 per share.

“After discussions with the Spirit team last week and further due diligence review, we are more convinced than ever that a JetBlue-Spirit transaction would create a true national competitor to the Big Four and deliver value to all of our stakeholders,” JetBlue CEO Robin Hayes said.

(Ryan McLean/Flickr)

“Our previous proposal was met with an extremely positive reaction from Spirit stockholders, and we believe they will be even more pleased with these improved terms, including additional regulatory commitments that reflect our confidence in our ability to obtain antitrust approval and are a direct result of our diligence,” Hayes added.

With regulatory approval the top of concern of Spirit’s leadership team, JetBlue reiterated its commitment to divest all of Spirit’s assets in Boston and New York, as well as gates at the Fort Lauderdale airport where both airlines have bases. The airline told Spirit’s board Monday that it would “not increase its presence in the airports covered by our Northeast Alliance” with American Airlines if the deal occurs.

Spirit has twice rejected JetBlue favoring, instead, its preferred merger partner Frontier Airlines. However, after JetBlue’s last offer, Spirit gave the carrier the same level of access to due diligence data that it had granted Frontier — something JetBlue had been seeking for months.

Denver-based Frontier declined to improve its offer, which totals roughly $2.9 billion in cash and stock, after JetBlue raised its bid on June 6.

A JetBlue-Spirit merger would create the fifth largest U.S. airline.

Airlines

Spirit Airlines Is ‘Engaging’ With JetBlue Over Its Improved Offer

3 weeks ago

Days after J.P. Morgan published a report stating the likelihood of a merger between Spirit Airlines and JetBlue Airways was improving, Spirit has said its board of directors was “engaging in discussions” with JetBlue following its improved offer.

The board was also continuing to work with Frontier under the terms of the existing merger agreement with Frontier, Spirit president and CEO Ted Christie said Tuesday.

“As part of this process, Frontier and JetBlue are being given access to the same due diligence information, on the same terms. The board expects to bring the process to a conclusion and provide an update to stockholders ahead of the special meeting of Spirit stockholders scheduled for Thursday, June 30, 2022,” it said in a statement.

Spirit had previously delayed that key shareholder vote on a merger — either with Frontier Airlines or JetBlue — by three weeks.

“Spirit continues to be bound by the terms of its merger agreement with Frontier, under which a ‘Superior Proposal’ is defined as being both reasonably capable of being consummated and more favorable to Spirit’s stockholders from a financial point of view,” the statement added.

Airlines

JetBlue-Spirit Merger Chances Improving: Analyst

3 weeks ago

A new report from J.P. Morgan analyst Jamie Baker sees the likelihood of a merger between JetBlue Airways and Spirit Airlines improving. The comments come days after JetBlue improved its offer for Spirit by more than $150 million, and the latter delayed a key shareholder vote on a merger — either with Frontier Airlines or JetBlue — by three weeks to June 30.

“We believe some merger involving Spirit is a high probability outcome,” Baker wrote Thursday. “We also believe a merger outcome between Spirit and JetBlue is a growing probability and may overtake the likelihood of a Frontier deal.”

(jtocchialini/Flickr)

JetBlue is offering Spirit shareholders $31.50 per share that totals roughly $3.4 billion. The offer includes a $1.50 per share prepayment of a $350 million break up fee in the event U.S. regulators do not approve the deal. Frontier is offering Spirit investors the equivalent to $2.9 billion in cash and stock.

On June 6, following receipt of JetBlue’s improved offer, Frontier declined to raise its bid for Spirit, Securities & Exchange Commission filings show.

Airlines

JetBlue Expands Booking Site Paisly in Time For Summer

4 weeks ago

JetBlue Airways has expanded its offerings on its travel product add-on site, Paisly, with new activities and more hotels just in time for what is expected to be a busy summer travel season.

Paisly, which is part of the airline’s JetBlue Travel Products business, has added more activities through travel experiences site Peek — these include things like parasailing, scuba diving, and paddle boarding in Miami, for example — and increased available hotel inventory to more than 4,000 properties, according to a statement Wednesday. In addition, the year-old site boasts additional customer service functionality and a new “look and feel.”

A collection of experiences offered by Peek. (Peek)

And, with a nod to the importance of loyalty, offers travelers points in JetBlue’s TrueBlue frequent flyer program and credits towards Mosaic status for purchases through Paisly.

“We realized that online travel sites for booking hotels, cars and activities still lacked exceptional service,” JetBlue Travel Products President Andres Barry said. “As we continue to grow as a travel company, our goal is to develop technology that allows us to take ownership over the customer’s entire experience.”

Paisly is part of JetBlue’s broader push to become more of a travel technology company than just an airline. JetBlue Travel Products generated $45 million in annual earnings before interest and taxes last year, and is on track to more than double that to $100 million in 2022.

Airlines

Spirit Airlines Delays Merger Vote to June 30

4 weeks ago

Spirit Airlines shareholders have another 20 days to decide whether they support a merger with Frontier Airlines or prefer a hostile, but potentially more lucrative if it’s approved by regulators, takeover by JetBlue Airways. The vote was previously scheduled for Friday, June 10.

Florida-based Spirit said Wednesday that the delay to June 30 allowed the airline’s board to “continue discussions” with shareholders, Frontier, and JetBlue.

(ajay_suresh/Flickr)

On Monday, JetBlue improved its offer to Spirit shareholders by more than $150 million to an all-cash $3.4 billion. Frontier is offering shareholders the equivalent to $2.9 billion in cash and stock.

Whoever Spirit decides to merge with, Frontier or JetBlue, will become the fifth largest U.S. carrier after American Airlines, Delta Air Lines, Southwest Airlines, and United Airlines.

Airlines

JetBlue Sweetens Deal For Spirit Airlines in Proxy War Volley

4 weeks ago

JetBlue Airways has raised its bid to takeover Spirit Airlines in the latest volley in an escalating proxy war with Frontier Airlines.

JetBlue upped its reverse break-up fee on Monday to $350 million — $100 million more than Frontier — and offered to pre-pay $164 million of said fee in its latest offer to Spirit shareholders. All in, the offer values Spirit at $31.50 per share.

(vic_206/Flickr)

The offer comes less than a week after Frontier improved its offer for Spirit with a $250 million reverse break-up fee.

“Combining JetBlue and Spirit would create a true national competitor to the dominant legacy carriers, delivering low fares and a great experience for more customers, more opportunities and good paying jobs for crewmembers and team members, and more value for stockholders,” JetBlue CEO Robin Hayes said in a letter to the Spirit board. “The key features of our improved proposal – the up-front cash payment and increased reverse break-up fee – are not an illusion. This offer reflects the seriousness of our commitment and underscores our confidence in completing this transaction. Additionally, given the similar regulatory risks of the two transactions and the increased reverse break-up fee we are prepared to provide, we believe our Improved Proposal remains a Superior Proposal by any measure.”

Spirit shareholders are scheduled to vote on the Frontier merger proposal on June 10. The vote is the culmination of a four-month saga since Frontier and Spirit first announced plans to merge. JetBlue unveiled an unsolicited bid for Spirit in April, which the latter carrier rejected. JetBlue is now attempting a hostile takeover by asking Spirit shareholders to reject the Frontier deal.

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Airlines

Strong Travel Demand Lifts Southwest Airlines, JetBlue

1 month ago

Southwest Airlines and JetBlue Airways have both seen travel demand improve since their last second-quarter guidance update in April.

Southwest expects operating revenues to be 12-15 percent higher than in 2019, which is either the upper limit of its previous guidance or three-points higher, the Dallas-based carrier said Thursday. The airline “expects solid profits and operating margins, excluding special items, in second quarter 2022 and for the remainder of this year.”

And JetBlue expects revenues to come in at the high end of the up 11-16 percent year-over-three-years range it previously provided, the New York-based carrier said Thursday. And in June, unit revenues — a measure of how much it makes per seat mile flown — are “shaping up to be meaningfully better” than April and May with an increase of 20 percent compared to 2019.

“The demand environment continues to be strong,” JetBlue said.

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